The check either refunds Liability, or uses the Prepaid Item; or, is created from a Credit memo.
"the check as AR is not listing as an open charge so that the credit can be applied."
Perhaps it already is linked to something or is applied already.
Like this:
You issued a refund check from a Credit Memo you just created, and also still have a Negative on hand from using Receive Payment months earlier, when no open invoices ever existed = now you have this Twice. That means the original Payment screen is where that credit is coming from. You would not also create a new Credit Memo. You simply issue that check as AR so that you can open the Original payment and link it to the Refund.
